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Our investments constitute a very substantial element of economic growth and their implementation helps to improve the quality of life and work for local communities. We provide stable employment to approximately 42 000 people across more than 200 locations in the country. The taxes that we pay to the municipalities, in which we operate, account for a significant part of the local governments’ budgets.
We are the third largest employer in Poland. Most of our personnel live in towns in the vicinity of our assets and a large number of our subcontractors are local enterprises, for which the co-operation with us provides the ability to develop their business activity.
Many activities for local communities are initiated by the PGE Group’s companies. As part of recurring activities, PGE Dystrybucja, the company responsible for the maintenance and development of electricity supply infrastructure is organising Energy Forums, during which it is sharing its related knowledge with the local government representatives. Within the entire Group, we are also conducting active dialogue with residents on the executed and planned investment processes.
An example is the planned construction of a nuclear power plant, where the Program to Support Development of Site Municipalities (in Polish: Program Wsparcia Rozwoju Gmin Lokalizacyjnych) strengthens partner relations with the local community and the authorities of three municipalities neighboring the first Polish nuclear power plant: Gniewino, Choczewo and Krokowa, as well as the Puck and Wejherowo poviats. We also try to support local entrepreneurs with our activities, which constitute a significant percentage of our suppliers and subcontractors. During the construction of power units in Opole, which was completed in 2019, we signed over 3,000 orders, over 80% of which with Polish companies. We try to follow this philosophy in all investment processes. We already know that our investment in offshore wind energy in the Baltic Sea is an opportunity to spread the wings for many Polish companies, many of which specialize in the production of components for the construction of wind farms and devices accompanying the implementation of such projects.
We are one of the largest domestic investors. Since the foundation of PGE Group 13 years ago, our capital expenditures have reached over PLN 75 billion. These funds were spent on the construction of new capacities, eco-friendly modernisations of existing assets and expansion of power and district heating networks. This is a very large amount, which could have financed approx. 2 000 km of new highways in Poland (the total length of highways in Poland is approx. 1 700 km, according to General Director for National Roads and Motorways).
In 2019, we invested PLN 7 billion. Our investments constitute a flywheel for the Polish economy – they include not only orders, many of which are commissioned to Polish enterprises, but also thousands of work places at construction sites and then operating units. Thanks to the electricity supplied by us and investments in distribution grids, entrepreneurs are able to develop their activity and seek new business opportunities. At the locations where we conduct our activity, we are often the biggest or one of the biggest employers and our investments are an additional flywheel for the growth of local markets.
We are also one of the biggest tax payers in Poland. At central and local level, our business in 2019 brought in approx. PLN 6.2 billion in taxes (approx. PLN 6.3 billion in 2018). This amount mainly includes: VAT, taxes and contributions for PGE Group employees, property taxes, CIT, excise tax, as well as other taxes and fees.
I would like to emphasize that today we are one of the largest CIT payers in Poland, and we provide the State Treasury and local budgets with over PLN 6 billion per year in various types of taxes. Despite huge investment challenges, we support the Polish economy and the state budget.
As a result of our activities, local governments (communities, poviats and voivodships budgets) received close to PLN 1.5 billion in 2019.
| 2019 | |
|---|---|
| Municipal budgets | 1,177 |
| Poviat budgets | 54 |
| Voivodship budgets | 234 |
| State Treasury | 3,311 |
| Social Security | 1,386 |
| Total | 6,162 |
*Estimates based on the consolidated financial statement, tax returns and documentation of other payments made to local governments under the law. The estimated division into individual levels of local government and territorial units was made on the basis of information on the amounts of taxes paid by individual PGE Group companies, employment in individual companies and provinces, and information on the distribution of income from PIT and CIT between local government units and the State Treasury.
In the Kleszczów municipality, which is where the largest lignite-based power plant and lignite mine in Europe are located, approximately 50% of all expenditures made by local government are financed from taxes paid by PGE Group.
In 2019, expenditure on the purchase of CO2 emission allowances under the European Emissions Trading System amounted to PLN 1 477 million. The EU Emissions Trading System (EU ETS) is a key component of the EU’s climate change policy and its primary tool to reduce greenhouse gas emissions. Funds from the sale of emission rights go not only to state budgets, but also finance climate protection and energy transformation.
